Of course, the position that managers have been put in – remote working, no opportunities to meet their clients in person, increased complexity in coordinating activities internally – is far from ideal, and asset owners understand this. However, it has felt as though many asset managers have tended towards a ‘one size fits all’ approach to client management during lockdown, with voluminous content and material often replacing the direct interaction and engagement that is the cornerstone of good customer service.
As we emerge – hopefully – into something resembling normality, asset managers will have to put themselves in their clients’ shoes and think carefully about what asset owners require in order to enhance existing relationships or, sadly in some cases, rescue those that are at risk.
One of the most consistent frustrations we have as asset owners relates to the quality and detail of the reports and documentation we receive. Asset owners are incredibly time-poor: many trustees of pension schemes, for example, will be filling that role alongside their day-to-day job; those that do these things as a profession will often have a number of pension schemes that they are responsible for.
As a result, asset owners need to be able to access and absorb as much information as possible as quickly and efficiently as possible. Long, dense reports and brochures simply don’t work, regardless of how well presented and designed they might be.
Such a scenario is made even more frustrating if the information within these reports is generic in nature, rather than being specific to that particular investor. Thinking about these things in absolute terms – the performance of a particular fund – just doesn’t work and there are far more nuances that asset owners need to be aware of and consider, albeit in a clear and succinct format.
We need to be able to see and understand the progress that is being made by our investments, relative to the specific objectives that have been agreed for that mandate. That is something that very difficult (if not impossible) to do if the materials provided by an asset manager are generic in nature and, for expediency reasons, cater to the needs of ‘pension funds’ generally rather than those of a specific institution.
This focus on progression is also relevant for one final, and arguably most critical, area – that of responsible investment. The requirements on institutional investors to show they are investing in a responsible, sustainable way are significant. Being told that this is happening and that asset managers have integrated ESG into their processes isn’t sufficient; we need to be able to track the journey that our investments are on and the improvements that are being made over time in order to meet our reporting requirements, be these those that are required by regulation or to inform an increasingly aware and discerning scheme membership.
The ending of lockdown restrictions now provides a platform for asset managers to act. Managers must use this opportunity to engage and understand their clients’ individual agendas, practically using this knowledge and insight to tailor future content and shape relationships going forwards. Those that are proactive and do so have the opportunity to make improvements, or at least address some of the frustrations that asset owners have felt over the last twelve months. The managers that do not will, frankly, struggle.